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The United Nations has called for “immediate suspension of government mandated
US ethanol production due to the ‘precarious’ Worldwide food supply” problem. This is reported by the Financial Times, Aug. 10, 2012. p.1. Coincidental with the FT development, Automotive Industries recently gathered information on three, low cost, new bio fuels not based on food related raw material. The three are discussed below.
As background to the current UN action, it is noted that in April, 1998, Cornell University professor, David Pimentel reported the findings of his corn ethanol study in which he concluded that ethanol from corn does not provide energy security for the future, is costly in terms of production and subsidies, and its production causes serious environmental degradation”. Ethanol’s energy content is 61% vs. gasoline.

Recent efforts to get economic bio fuels into production for the military, air lines and many others will soon have available new tech systems that produce fuel at half the cost of petroleum. Two microorganism and one biomass based system confirm the bio fuel industry is coming up to speed with needed production and cost advantages. Butanol from corn, however, is likely viewed as having the same ‘food use’ characteristics as ethanol.
Among examples of cost competitive bio fuels is the AlgaeTec system formally
launched Aug. 2, 2012 in Shoalhaven, NSW, Australia. The firm’s executive chairman, Roger Stroud announced commissioning of a 2000 unit system that will produce diesel fuel at $35 to $40/bbl not counting carbon capture credits.

Stroud said the 2000 unit system will consume 1 million/tons/yr of CO2, produce 500,000 tons/yr algae and 250,000 tons/yr of diesel or JetA fuel. AlgaeTec systems are
now being installed at a Holcim LTD facility in Sri Lanca(one of many Holcim cement producing units worldwide) Also, a 250 unit system is being built with a joint venture partner, Shandong Kerui Lanna LTD in China

AlgaeTec’s MOU with Lufthansa for evaluation of the system may be particularly
significant in view of intense efforts of airline and military users of liquid fuels each with important priorities and common need for fuel that does not require modification of
engines, is lower cost than petroleum and not sourced from politically uncertain regions.. AlgaeTec packages its technology in standard 40 ft. containers for mass production yet easy shipment to any location. This is ideal for air lines and the military; in effect, distributed production. It does not require fresh water or input of any biomass (food grade or other).
Another advanced bio fuel technology expected to also be at or near half the cost of petroleum will soon be in production at a 11 MMGY initial plant of KiOR in Columbus, Mississippi. The KiOR system is based on thermal-catalytic reduction of biomass into diesel fuel, for which the firm already has off-take agreements with bulk users including Federal Express.

KiOR, a Khosla Ventures business, has available to it vast quantities of Southern
soft woods, used in the making of paper which has been in decline in recent years.
One estimate puts the number of closed paper mills at 100, which are candidates for
conversion to production of bio fuel by the KiOR system. Southern soft woods could be a source of the bio fuel sought by the military along with providing jobs for people in the area idled by paper mill closings.

Perhaps the technically most dynamic of the low cost bio fuel technologies is one for which a $100 million production plant is now being built in New Mexico by the world class engineering firm, Fluor, for Joule Unlimited. Joule earlier demonstrated at a pilot plant in Texas that cultivation of its proprietary microorganism in salt or brackish water plus waste CO2 and nutrients produces low cost diesel fuel or ethanol. The process obtains its solar energy from flat panels facing the sun.

Something around half the cost, compared with petroleum for diesel fuel, is claimed by Joule which is staffing up for marketing its system worldwide. The New Mexico plant, now built on a 1200 acre site, is scheduled to be operating in 2013. The firm has options on additional 5000 acres which can be expanded as needed and would not be limited for need of fresh water or much of anything else. Production energy comes principally from solar panels and waste CO2. New Mexico has vast land areas available for production of Joule fuel and expects to become a major source of drop in US bio fuel.

Microorganism based bio fuel systems that require no biomass or fresh water and which up-take CO2 and solar energy appear to have excellent potential for attracting the investment needed for large volume production over the long term.

Combined with the continuing high cost of Middle East oil supply line protection, need to divert purchased crude oil cost into U.S. domestic fuel jobs and the simple matter of lower cost, give new bio fuels added meaning. As the reality of new drop-in liquid fuel comes into focus, its contribution to much needed U.S. economic growth gains traction. There is a lot of room for capture of more of the 65 billion gallons/yr of diesel fuel used in the U.S. Now add the market for JetA fuel and consider emerging ways to make alternatives to the 480 billion gal/yr U.S gasoline consumption.

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